Pakistan Banking System Receives Major Upgrade as Agent Interoperability Is Introduced Nationwide

Pakistan is moving closer to wider financial inclusion after the State Bank of Pakistan approved the adoption of agent interoperability for banks, microfinance banks, and fintech operators, a step expected to significantly improve access to basic banking services, particularly in underserved and remote areas of the country. The initiative aims to reduce long-standing barriers that have limited millions of people from accessing formal financial services due to distance, cost, or lack of nearby bank branches.

With agent interoperability, customers will be able to use a much broader network of branchless banking agents to conduct everyday financial transactions. Instead of being restricted to agents belonging to a single bank or branchless banking provider, users will be able to access shared agents across multiple networks. This will make services such as cash deposits, withdrawals, fund transfers, and bill payments more convenient and widely available, especially in rural and low-income communities.

Under the new arrangement, banks and microfinance banks can connect with agents from different branchless banking networks, allowing seamless interaction between institutions. The State Bank has encouraged financial institutions to participate in this system to accelerate financial inclusion and improve the reach of digital financial services nationwide. To support this initiative, the central bank has authorized a payment system and payment service operator, Virtual Remittance Gateway, to develop and operate the backend infrastructure for the interoperability platform.

The system has already undergone pilot operations in recent months, with Easypaisa acting as the acquiring network and HBL Connect serving as the issuing network. The successful pilot has demonstrated the platform’s ability to handle transactions across different providers, paving the way for commercial rollout across the banking and fintech sector.

Industry experts are describing agent interoperability as a transformative development for Pakistan’s financial ecosystem. The shared agent model is expected to expand access points for financial services, reduce the need for banks to build separate agent networks, lower operational and infrastructure costs, and enable smoother fund transfers across different banking platforms. This approach is also likely to improve efficiency and convenience for customers, who will no longer need to locate agents tied to a specific provider.

According to data from the State Bank of Pakistan, the country currently has more than 756,000 registered branchless banking agents operating under 14 branchless banking providers. This network far exceeds the number of traditional bank branches, which stand at just over 19,000 across 42 commercial and microfinance banks. By allowing these agents to serve customers from multiple institutions, the regulator expects to maximize the impact of existing infrastructure and close gaps in financial access.

The State Bank has now permitted banks and microfinance banks to adopt the agent interoperability platform on a commercial basis. Financial institutions have welcomed the move, describing it as a key enabler for building a more inclusive and efficient financial system. The platform will link banks, microfinance banks, digital banks, and fintech companies through a single interoperable network, supporting the broader shift toward digital banking and cashless transactions.

Commenting on the development, ABHI Microfinance Bank’s Chief Commercial Officer Mariam Pervaiz said that agent interoperability is a crucial foundation for advancing financial inclusion in Pakistan. She noted that the shared infrastructure model will allow microfinance banks to extend their services to a wider population without the heavy costs associated with building independent agent networks.

Meanwhile, Virtual Remittance Gateway CEO Muhammad Salman Ali said the interoperability platform is based on modular, cloud-native middleware technology designed to ensure secure, end-to-end transaction processing. He added that the system will play a key role in accelerating financial inclusion and supporting the growth of a more inclusive and resilient digital economy in Pakistan.